Common sense in enterprise network services these days is that being the biggest operator, and owning a sprawling global network, is not the advantage it once was for winning enterprise contracts. Whether called network aggregators or virtual network operators, companies that assemble infrastructure through partners have long played off margin arbitrage between wholesale and retail network rates.
The field of network aggregation specialists includes international experts that pull together services, such as Globalinternet, Brodynt, and Expereo. Some operators, such as GTT, NTT Global Networks, and Global Cloud Xchange acquired and absorbed specialist aggregators. The US market is large enough to host domestic specialists such as Granite Telecommunications, Hughes Network Systems, MetTel, TailWind Voice & Data, and Bandwave Systems.
Enterprises often do not appreciate the complexities behind aggregating network access, and it can be a thankless task. Buyers may wonder if they are paying too much compared to purchasing direct. When there are network issues, the aggregator takes the blame for other parties' failures.
Aggregation was not always this hard. Decades ago, carriers simply sourced dedicated circuits from incumbents. As the number of competitive operators grew, so did competitive fiber and standardized Ethernet options. Now, enterprises also want broadband to be part of their hybrid networks. That means managing more access partners and services at tighter margins. Enterprises want PON and cable DOCSIS in the mix; xDSL as an option; 4G LTE for temporary and failover uses. Multiply support by dozens or over 100 countries, and carriers face a very serious management burden.
Broadband services footprints are a patchwork quilt. Each operator and each service has different business processes, network performance, features, and guarantees. The enterprise expects its partner(s) to normalize and deliver a platform that looks and feels unified. They want it done cheaply. In the US, for example, an enterprise expects to pay less than $100 per site per month for entry-level fixed broadband; the strike price for a high-quality broadband connection is about $200. After subtracting wholesale cost, there is little left over for the aggregator.
But network operators have no choice. If they want to bid for other parts of the business such as hybrid WAN and managed SD-WAN, they must be masters of managed access. That means maintaining a stable of options for dedicated and broadband access. Smaller operators address the issue by signing a few aggregation partners, and limit their direct relationships and out-of-footprint ambitions. Big global network providers assemble partnerships to claim hundreds, even up to 1,000 supported services.
The access aggregation challenge is one of many sobering aspects in telecommunications today. Operators must manage more and more partner services while pushing down budgets. Could national 5G services provide relief by consolidating enterprise broadband access? The more likely reality is that 5G will be yet another type of access that enterprises simply expect network provider partners to support across their footprints: yet more support work without a net new revenue boost.